Transaction monitoring plays a key role in keeping your business safe from financial crimes such as money laundering, bribery and corruption, terrorist financing, and fraud.
Simply put, this function entails keeping a close eye on the transactions handled by your business, and it lets your internal anti-financial crime team identify and investigate transactions and behaviors that indicate criminal activity.
The Need to Upgrade Your Transaction Surveillance System
Flagging suspicious activity consumes a lot of resources, especially if your company has to handle hundreds of thousands of financial transactions daily. The large volume of information that you need to sift through and analyze is just one of the many challenges of monitoring financial transactions. To effectively carry out their tasks, your compliance team members must also become familiar with criminal behaviors and patterns, which tend to change in order to bypass existing security measures.
It’s difficult to keep up with all of these challenges if you’re still using dated surveillance solutions. Legacy transaction monitoring software can no longer effectively monitor and analyze huge chunks of data, and these tools can easily overlook suspicious activities that are designed to bypass current security and financial crime detection systems. The burden of compensating for these technical inefficiencies, then, will fall on your investigation team members. The added work that they need to do will build up over time, and this can either distract them from critical tasks that require human attention and understanding, or it can cause them to burn out.
Upgrading your transaction surveillance system seems like it will only improve a small fraction of your overall compliance and regulatory reporting processes, but it can do more than that. With the help of current transaction monitoring solutions, you’ll be able to increase your company’s competitiveness. This can be done through:
Managing an Overwhelming Amount of Information with Ease
The scope of your operations will dictate the amount of information that you have to check, analyze, and possibly link together. A dated surveillance system may only be able to monitor a limited number of transactions in a given day. This simply won’t do if you have a large customer base. Failing to check a chunk of the deals that go through your systems will make your company more susceptible to financial crime.
This is not the case if you’re using an updated surveillance system that’s designed to meet the specific and current demands of your company. Newer surveillance systems can collect and process more data, and they can also be customized to look for specific indicators of financial criminal activity. Some surveillance systems even use artificial intelligence, which can be tasked with linking related cases and organizing relevant data. Without having to worry about these automated tasks, your investigators can focus on critical tasks where they can best use their skills and training.
Gaining a Holistic View of Your Business Transactions
Investigating potential criminal activities—or even just detecting suspicious events—is a difficult task if you don’t have a holistic view of your business transactions. Unfortunately, this is a persistent problem when it comes to older surveillance systems. These dated monitoring solutions offer a limited perspective and incomplete data, preventing investigators from seeing the bigger picture.
Newer surveillance systems address this specific issue by providing wider coverage to their users. An updated monitoring system will allow investigators to easily access information that may be related to the case they are handling. As such, they are less likely to miss details and events that will help them build their case, carry out more thorough investigations, and provide more accurate assessments.
Improving the Structure and Flow of Your Investigations
Old transaction monitoring solutions are often customized to prioritize transaction types that the company deems to be high-risk. This system has its advantages, but it can also overlook suspicious activities and leave a lot of manual work for the members of the investigation team.
Current transaction monitoring solutions, on the other hand, are designed to process information more thoroughly. Every piece of information that is fed into the surveillance system undergoes checks and a validation process. Events that are not able to meet the system’s data standards are flagged. The system also takes care of aggregating relevant information about these outstanding events and connecting them to other events that share the same characteristics. The collected information is then presented to human investigators for a more thorough and nuanced analysis.
Gain an Edge over the Competition Using Your Transaction Monitoring System
The high cost of transaction monitoring is justified by the fact that this function serves as your company’s frontline of defense against financial crime. An effective and updated transaction monitoring process can discourage financial criminals from targeting your company. With it, you can also expect your business to have an easier time complying with the requirements and guidelines set by the regulatory bodies and law enforcement agencies that govern your industry or area of operation.